OECD Culture and Local Development.pdf - PACA

2. LOCAL DEVELOPMENT BASED ON ATTRACTING VISITORS AND TOURISTS
or other productive resources, their prices are linked, and any shock to one will be
felt by the other. The reactions of economic agents to price movements sparked by
the cultural investment will of course be greater if the relative weight of the cultural
sector is high. The elasticities that determine the scope of these reactions will play
a determining role.
- The first elasticity to be considered is that of the supply of labour in relation
to wages. If labour supply elasticity is infinite, a territory can respond to higher
labour needs without causing wage costs to rise for other activities. If the territory
is short of labour or is poorly integrated, with little flow of employment between
various activities or sectors, the cultural investment will cause wage rates to be
bid up, or will require the import of higher-cost labour, and the effect will spill
over to all local labour markets.
- The second elasticity to be considered is that of the supply of goods from the
local non-cultural sector, in relation to prices. If product supply elasticity is
infinite, a territory can respond to higher demand without causing costs and wage
claims to rise. If the territory is short of productive resources or is poorly
integrated, the cultural investment will lead to tensions and even to the import
of high-cost goods and services, and the effect will spill over to all local markets
for goods and services.
In both cases, the degree of the territory’s integration is the determining factor.
The more integrated a territory is, i.e. the more of its own resources it can use or redeploy
for productive purposes, the more likely it is that the tensions created by investment
can be absorbed, with the positive effects outweighing the negative ones. The less
integrated a territory is, i.e. the less able it is to mobilise local resources or redeploy
them, the higher will be the tensions generated by the investment, with the negative
effects outweighing the positive effects.
The lifecycle of a cultural good
The behaviour of those who offer cultural and tourism services can also influence
the expected impact of a cultural investment. This influence may not merely expand
or weaken that impact, but may in fact exhaust the cultural resource itself: for this reason,
we may speak of the “lifecycle” of the monument. This is not a new phenomenon, and
many sites have already been destroyed by overexploitation. Yet while some will ascribe
this to faulty management of tourism flows, others will see in it the rational behaviour
of certain economic agents (Caserta and Russo, 2002).
Let us take a tourist site that consists of two parts: a heritage core and its
surrounding district, the latter depending for its livelihood on the drawing power of
the former. Every visitor is assumed to buy two types of goods or services:
CULTURE AND LOCAL DEVELOPMENT - ISBN 92-64-00990-6 - © OECD 2005 89